Elon Musk, Tesla Motors CEO, tells the Reuters Global Tech Summit that he'll talk to politicians who back local car dealers trying to keep Tesla from selling directly to consumers. Video
- Special Report: Syria's Islamists seize control as moderates dither
- Arizona killer who asked for speedy execution found dead in cell
- Actor James Gandolfini, star of 'The Sopranos,' dies in Italy
- UPDATE 2-Storm Barry heads for Mexico Gulf coast oil installations
- New generation of elite universities rises around the globe
Gold flat as Europe stocks gains muted by U.S. Sandy
LONDON (Reuters) - Gold prices were little changed on Tuesday as European stock markets rose and the dollar weakened, but moves were limited as New York markets remained closed due to Hurricane Sandy, and ahead of a key U.S. jobs report due later this week.
Gold took some support from strength in European shares, which were boosted by well-received company reports from BP and UBS, and the euro, after data showed the Spanish economy contracted at a slightly slower rate than forecast in September.
Spot gold rose by just 0.6 cents to $1,709.86 an ounce at 3:23 p.m. EST (1500 EDT). U.S. gold futures for December rose $3.40 to $1,712.10.
But the metal remains on course for its first monthly loss since May as a boost from the Federal Reserve's latest monetary stimulus plan - a potentially inflationary move which would also maintain pressure on interest rates - petered out.
It hit an 11-month high above $1,795 in October after the Fed's stimulus plan but retreated after failing to break $1,800. It is down more than 3 percent for the month.
As the extent of the program has been linked to the health of the jobs market, Friday's U.S. non-farm payrolls report could potentially influence its scope.
A Reuters poll shows the economy is expected to have added 125,000 jobs last month, though the unemployment rate is seen at 7.9 percent, against 7.8 percent the previous month.
Peter Fertig, a consultant with Quantitative Commodity Research, said the stubbornly high rate of unemployment in the United States suggested that monetary easing was not likely to end soon, signaling well-supported gold prices.
"The level of unemployment is still at a level where the Fed does not feel comfortable with it," he said.
The Bank of Japan boosted its monetary stimulus for the second month in a row on Tuesday in response to intense political pressure for action and mounting evidence that the world's third-largest economy was on the cusp of recession.
Deutsche Bank analyst Daniel Brebner said the Bank of Japan decision was supporting the gold price even though the move had been expected, as further monetary stimulus was seen as generally supportive to gold.
Mitsubishi analyst Matthew Turner said focus was also turning to next week's U.S. election. "The dollar might strengthen regardless of the election result. Political uncertainty would be reduced if there is a clear election victory," Turner said.
SHOOTING AT AMPLATS MINE
Gold importers in India, historically the world's biggest gold consumer, bought the metal ahead of festivals as local prices held near two-month lows.
India's festival season peaks in November with Diwali, the Hindu festival of lights. Weddings also take place at this time, with gold jewelry part of the dowry daughters receive from their parents. <GOL/IN>
From a technical perspective, analysts who study past price patterns for clues on the next direction of trade flag up support for gold at $1,703 an ounce.
ScotiaMocatta identified support for prices at $1,693, a key retracement level in gold's move from its low of the year in May to its October high. "Resistance is at $1,722," they added.
Standard Bank said in a monthly precious metals report that gold had not been an attractive investment after the Fed's latest round of monetary stimulus.
"We were not keen buyers of gold at $1,780; however, we are at levels closer to $1,700," the bank said.
"At $1,780, we estimated that gold was pricing in too much QE (quantitative easing) already, even when compared to its behavior during previous rounds of easing by the Fed."
Platinum and palladium prices rose, bolstered by violence at a major South African platinum mine.
South African police fired rubber bullets and tear gas at striking Amplats (AMSJ.J) miners who were protesting against a union-brokered deal to end a six-week wildcat walkout at the top platinum producer.
"If this situation worsens, platinum group metals prices could move higher," Mitsubishi's Turner said.
Spot platinum gained 1.3 percent to $1,549.99 an ounce, and palladium was up 1.25 percent at $593.22 an ounce. Silver was up 0.16 percent at $31.81 an ounce.
(Editing by William Hardy)
- Tweet this
- Share this
- Digg this